10 Sep '11, 6am

Resource challenges for infrastructure investment - Think a lot depends on WHICH infrastructure.

For mainstream Keynesian Democrats who have not yet become troubled about resource depletion and its rather intimate relationship with the economy, infrastructure spending makes obvious sense. It represents investment in the economy of the future and in this sense will be “self-liquidating” or dividend-paying. But that this belief is not the main motivating factor for infrastructure spending is in itself telling about economic assumptions. The main reason for infrastructure spending, of course, is to create jobs and the much anticipated “multiplier effect.” With the multiplier effect, the construction workers who build a new bridge, for instance, will spend money at local restaurants and bars, the owners of which will be able to hire more people and perhaps finally buy that new car . This in turn will help the car-salesman build a new house, creating construction jobs, whi...

Full article: http://www.energybulletin.net/stories/2011-09-09/why-infr...

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